Looks like on-island Desmond didn't know that the alternate timeline wasn't an alternate timeline at all.
The whole season was a big misdirect to make us think that the sideways flashes were how the characters lives would have unfolded if the island sank in 1977.
I thought about both those points during the show. Desmond sure was surprised when he didn't hop over to the "alternate timeline"! Of course, he would've had to die to get to the afterlife and it wasn't his time. But, he didn't know that.
I don't understand why they showed us that the island sunk? It didn't sink. And, someone speculated that it was in the future, but I don't believe that. The way it was shown was that it was submerged in the present. A huge misdirect, and they bent the truth to do it. I feel a bit cheated by that. Or, the writers weren't sure where they were heading when they did that.
The whole afterlife story was basically separate from the island story. Anything could've have happened, the island details didn't matter, and they would've all eventually died and met up there. Kate could've died instead of leaving the island, no difference. Same with any of the characters. A bit unsatisfying.
So, it's easiest to think of that as a separate story entirely. Somehow that's not very satisfying to me. The island resolution was a bit weak and could've used some fleshing out. The afterlife story did provide a boat load of awesome character moments and the message was spot on. Mixed feelings for sure.
Mr Awe